Don’t Get Caught Making These Crypto Mistakes
It’s no secret the second quarter will be impacted by rapidly changing interest rates, Fed tightening due to a serious miscalculation about inflation, and continued fallout from geopolitical turmoil thanks to Russia.
Both stock and bond markets are highly volatile and it looks as though large daily price swings will continue. A restrictive monetary policy is causing short term rates to rise rapidly, and long term rates to move moderately, thus the yield curve is flattening, and we may yet see an inversion where short term bond yield more than long term bonds. Why does this matter? Prior inverted yield curves have predicted recession.
Any interest rate move upwards from 0 is a good thing for savers who have been pummeled over the years. But further near-term equity gains may seem elusive as further down the road the steam runs out of the bull market. Risk asset returns may fall short of what came to be the expectation over the last few years. And maybe that is ok.
We would caution that in unforgiving markets, it is not wise to take on more risk in order to make up for lost gains. When markets are rising, you can easily recover from mistakes. The paradigm shift is how to invest when expected returns are low. It stands to reason that when assets are at an all-time high future returns are likely lower.
The Fed convenes again in May. This is a time to save by examining investment management fees, and avoiding illiquid assets and risky holdings. Instead, take a look at the diversity of your portfolio. But be selective, alternative investments have advantages, but also risks, and are not for everyone. Inflation erodes the value of money that is not invested.
Reach Out to Us: When uncertainty is high, investing naturally becomes more complicated. This is a time for building resilience in portfolios through diversification and a focus on quality. The value vs growth debate has been reignited, let us help guide you through. How your portfolio is constructed to meet the new challenges of inflation and interest rates will have a big impact on both your peace of mind and the progress you make in the next year toward your financial goal post. Feel free to contact me, Cory Lyon, directly at 561-209-1120, with any questions. At TFG Financial Advisors, our goal is to assist you in making informed decisions. We believe in personalized asset management, and I act as a fiduciary for all my clients.
TFG Financial Advisors, LLC is a registered investment advisor. Information presented is for educational purposes only and does not intend to make an offer or solicitation for the sale or purchase of any securities, and past performance is not indicative of future results. Investments involve risk and are not guaranteed. Be sure to first consult with a qualified financial adviser and/or tax professional before implementing any strategy discussed here.
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TFG Financial Advisors, LLC, is registered as an investment adviser with the SEC. Registration is not an endorsement of the firm by securities regulators and does not mean the adviser has achieved a specific level of skill or ability. The firm is not engaged in the practice of law or accounting. All expressions of opinion reflect the judgment of the authors on the date of publication and may change in response to market conditions. You should consult with a professional advisor before implementing any strategies discussed. Content should not be viewed as an offer to buy or sell any of the securities mentioned or as legal or tax advice. It is not affiliated with or endorsed by the Social Security Administration or Medicare. You should always consult an attorney or tax professional regarding your specific legal or tax situation. Tax rules and regulations are subject to change at any time. All investment and insurance strategies have the potential for profit or loss. Information presented is believed to be current. Photos and videos are used for the singular purpose of enhancing the website. None of them are photographs of current or former clients. Hyperlinks on this website are provided as a convenience. We cannot be held responsible for information, services or products found on websites linked to ours.